One afternoon in late fall, I passed by CAVA, a new fast casual restaurant on Park Avenue South. It was late lunchtime, after 2 pm, but the line waiting to get in was still long. I passed by, again, several days later, at about the same time, and again, the line was long. In 2016, when fast casuals were booming throughout Manhattan, it was not unusual for a new restaurant concept to quickly develop waiting lines due, primarily, to social media. This past year, fast casual restaurants have over-saturated the city’s blocks and waiting lines have virtually disappeared. CAVA, however, seems to be maintaining long lines since their recent opening, even in the cold month of January. I did some homework and asked millennials in my “co-working office” space about CAVA, as well as my young niece, who lives in D.C. where Cava Mezza originated.
CAVA has a nice story. Founded in Rockville MD, in 2006, friends Ike Grigoropoulos, Ted Xenohristos, and Chef Dimitri Moshovitis, all sons of immigrant parents, opened Cava Mezza, a full-service Greek restaurant, to pursue their childhood dream of offering modern, healthy Mediterranean food – small plate style. Cava Mezza was an instant success. More locations were added in the D.C. area, and by 2015, there were a total of five, including one in Baltimore. Their steady growth and popularity attracted private equity investment, most notably from Steve Case and Revolution Growth, and a savvy senior management team. Brett Schulman, an investment banker, was hired as CEO in 2009. Armed with sufficient capital, a fast-casual concept, Cava Grill, was rolled out nationally. Currently, CAVA, now with 46 restaurants plus 16 in development nationwide, is ahead of schedule opening locations. CAVA’s popular dips and spreads can also be purchased in all Whole Food Markets and online, along with recipes for the home cook.
When I polled my vegetarian niece, she equated the Mediterranean CAVA to the Mexican Chipotle, but without trying as hard. She believes CAVA has done a great job with aesthetic branding. The food and physical plant have visual appeal. The flavor profiles are unique and fun. The restaurants are hip. CAVA has become a lifestyle. The company has learned from Panera and Shake Shack, as well as Chipotle, about developing reliable supply lines, installing food safety checks, expanding into growing geographical regions and health conscious cities, and achieving employee loyalty by paying above-market wages, while offering attractive benefits.
Summing up CAVA’s success factors –
- An American story – passionate sons of immigrants
- Modern take on healthy, ethnic food
- Emphasis on fresh ingredients and food cooked in-house
- Major wholesale presence distributing products to all Whole Foods Markets
- Aesthetically appealing food and décor translate to a cool vibe
- Sufficient private equity funding for expansion
- Employee focused, offering above-market wages, good benefits, and growth opportunities
- Strategic expansion into growth cities
- Perceived as excellent price/value
- Strong Senior Management team
CAVA appears to be poised for success as a fast-growing restaurant company that, today, is doing all of the right things.
by Joe Radice, Vice President, Wray Executive Search